These Brothers Went From Security Guards To Running A Proptech Platform With Partners Like Airbnb
The lockdowns enforced by the coronavirus pandemic have crippled the hospitality industry, so it would be no surprise if a small proptech startup that links big property owners with the shorter-term stay market didn't survive. But to predict that fate for Staykeepers is to underestimate Ivo and Miroslav Gospodinov.
“We’re used to bootstrapping in real life, not just in business,” Ivo said. “Our background builds a level of resilience and agility that has allowed us to adapt.”
That background involved arriving in the UK from Bulgaria with no connections and little money, working multiple jobs while studying, and then building Staykeepers, a proptech business that received £500K of angel investment in late 2019 and was on course for an £18M valuation before the pandemic struck.
The dip in travel caused by the lockdown hit revenue, but the company has adapted, and in the midst of the lockdown forged its most significant relationship yet, and now has a partnership with short-term rental giant Airbnb.
A model of diversity, with its 60 staff coming from 19 different countries and a huge variety of backgrounds — a fact the duo cites as helping foster the company’s resilience — it is now on the fundraising trail again, with a £500K crowdfunding campaign that it hopes will fund expansion.
“We’re a hospitality tech business, so revenue and reservations have been impacted,” Ivo said. “But we’ve built the company from the bottom up, and that has allowed us to move fast and adapt to the situation.”
Staykeepers, which the brothers founded in 2015, builds relationships with big property owners in sectors like student housing or build-to-rent/multifamily, and it uses its platform to find short-term tenants for vacant units or units where the occupant might not be in situ; or find traditional mid-to-longer term tenants.
While the owner might advertise on a few well-known platforms like Rightmove, Staykeepers identifies other websites where shorter or mid-to-long-term tenants might be found and integrates the units on these platforms to market them. The company’s analytics platform allows owners to monitor the occupancy of the units Staykeepers manages, which stayed at 70% during the pandemic.
As well as the digital platform, Staykeepers provides physical staff for front-of-house or property management services for the short-term lets if the owners don’t have their own or don’t want to redirect staff from their core business.
During the pandemic, as short-term travellers dried up, Staykeepers pivoted its business to focus on lets that were still short-term, but longer than it had previously targeted, with the average stay at one of the units it was managing rising from six to 27 nights.
“With lockdown, flights were stopped and we had to change our demographic and work to attract more local travellers, which has proven to be successful,” Miroslav said.
The platform it has created attracted the attention of Airbnb, which post-IPO and post-pandemic is also looking more closely at the longer-term letting market, with the access to the portfolios of institutional property owners appealing to the tech giant.
Having survived what now appears to be the worst of the pandemic, the Gospodinovs feel a period of expansion is around the corner. One of the impacts of Covid-19 has been to catalyse the adoption of technology in the property sector, and that is especially true for technology that helps produce more income. New interest from student accommodation owners has been particularly high, Miroslav said.
“Landlords have become more motivated and open to alternative income streams,” Ivo said. “Covid-19 has enforced innovation and adaptation in the real estate sector, and I see that accelerating, not decelerating.”
The company currently manages about 1,200 units where it finds short-term lets, and post lockdown, the company hopes to manage up to 2,000 units, and it is planning potential expansion into the U.S. and Europe.
Tech founders often talk about "bootstrapping," building a company up with no outside backing. The Gospodinov brothers embody that colloquialism.
They arrived from Bulgaria in 2009 with very little money in their pockets, and no background in real estate, taking jobs as bartenders and security guards, occasionally having to sleep in their car, anything to make ends meet, they said.
Miroslav, who Ivo describes as the more academic of the pair, graduated with a masters in finance and risk from the University of East London, and in 2015, a previous startup venture morphed into Staykeepers.
“When we came to the UK, we didn’t come with capital, and we needed to work and be self-sufficient,” Ivo said. “Usually, hard work beats talent. And we are hugely motivated, and that motivation has allowed us to bootstrap and create the company we have.”
They take this attitude into their hiring process. The company’s website and the brothers themselves talk about working toward allowing people to be their best selves, and they practice what they preach.
In a blog on the company’s website, Ivo tells the story of a homelessness charity he and his brother support. He tells the story of seeing “a picture on Facebook of a homeless man looking for a job. He lived under a bridge and his clothes looked a bit scruffy, but he spoke four languages and loved playing chess," Ivo wrote. "His name was Thomas, from Lithuania. Thomas didn’t smoke or drink, he only wanted to work and get off the streets. A flashback to [our] homeless days, [we] decided to find him and give him a chance.”
Thomas became employee No. 6 for the company, and went from maintenance to managing building ambassadors for Staykeepers. He now owns a small cleaning company.
“We don’t just want to hire high performers, we want to make sure people are 100% comfortable and it’s the right position for them,” Ivo said. “A lot of people are just in a job and are doing it while they are thinking about something else. We want to find people who are motivated like us, and whose journeys are overlapping.”
Miroslav argues that diversity and hiring people from nontraditional backgrounds is not just about being altruistic. He cites writers like Matthew Syed and investors like hedge fund manager Ray Dalio, who argue that diversity of thought is the key to success.
“Diversity, the different nationalities, it's about bringing something different to the company,” he said. “It gives you leverage, you can leverage the different ideas and knowledge of different systems. Companies can have blind spots and biases that they don’t even know about. It helps managers to think outside the box and question their existing paradigms.”